State Legislators Pile Up $8 Million for Campaigns;Incumbent Advantage Will Grow with PACs’ “Gratitude Money”

A review of financial reports by the watchdog group Democracy North Carolina shows that state legislators running for reelection have stockpiled more than $8 million in cash for the final months of the 2014 campaign.

Legislators of both parties can also expect a windfall in special-interest donations when the General Assembly adjourns, likely this week, said Bob Hall, director of the nonpartisan group.

The 101 Republican legislators seeking election to the NC House or Senate hold $6.8 million in cash, more than four times as much as the $1.5 million held by the 52 Democrats. (The other 17 legislators are retiring or running for another office, or they were defeated in the primary.)

Senate President Pro Tem Phil Berger (R-Rockingham) led all lawmakers with $1,015,460 in cash as of June 30, the deadline for the most recent financial report. The next report is not due until late October. Senate Republican Majority Leader Harry Brown (R-Onslow) is next with $444,267, followed by Democratic Senator Josh Stein (D-Wake) with $347,413.

Because Speaker Thom Tillis is running for the U.S. Senate, the Republicans in the House who have the most cash are Rep. Tim Moore (R-Cleveland) with $251,573 and Rep. Nelson Dollar (R-Wake) with $246,216. Both men have Democratic opponents in the general election, but neither challenger had more $9,000 as of June 30.

“The combination of big-money fundraising and highly partisan redistricting means we’re seeing less competition in general elections,” said Hall “It’s hard to hold legislators accountable when they don’t have competition.”

Of the 153 legislators seeking reelection, 74 – or nearly half of them – face no opposition from the other major party.

With few exceptions, the other 79 legislators hold a “stunning cash advantage” over their opponents, Hall said. He pointed out that 55 of the 79 challengers had less than $10,000 in the bank as of June 30. Only six challengers had more cash than the incumbent (see below).

The 79 legislators with major party opponents had nearly 5 times as much cash as their opponents on June 30 – $5.8 million compared to $1.2 million.

The incumbents’ advantage will only increase when the legislature adjourns, Hall said, because donations to legislative candidates will then be allowed from political action committees (PACs) and over 95 percent of their money typically goes to incumbents.

“PACs are prohibited from donating to legislators while the General Assembly is meeting or in recess, but after the adjournment gavel drops, a flood of what you could call ‘gratitude money’ begins flowing to the members, even to those who have no opposition in the fall,” he said.

Hall pointed out that two years ago, in the seven weeks after the July 3, 2012, adjournment, the Duke Energy PAC sent checks to 72 legislators totaling $152,000. Duke will likely be generous again this year Hall noted, because the proposed legislation to manage the company’s coal ash pollution neither requires Duke’s stockholders to foot the bill for the clean-up nor requires removal of the pollution from the company’s 33 waste pits at 14 locations across the state.

Other PACs began showering legislators with donations in the same seven-week period after the 2012 adjournment, Hall said. For example, the chiropractors’ Healthy Network Solutions PAC wrote checks to 28 legislators totaling $24,000 on August 8th and the McGuire Woods lobby/law firm’s PAC sent $43,000 to 27 legislators.

Some PACs waited until after Labor Day. For example, on September 10, 2012, the First Citizens Bank PAC sent a donation to nearly every legislator – 112 checks adding up to $87,500. A week later, the Petroleum Marketers PAC wrote 48 checks to legislators for $41,250.

Altogether, PACs donated $9.9 million directly to legislative candidates in 2012. Hall expects that figure to increase this cycle. PACs also give directly to caucus committees – bank accounts within each major party that incumbents use to steer funds into the most competitive races.

“Legislators are on a constant chase for money to win reelection and win the swing seats that determine who gets majority control of the House and Senate,” said Hall. “Without a public financing option, they’re looking for sources of private wealth, and the special-interest PACs are happy to fill their need because they’re convinced the donations give them an inside track when they need something back from the legislators. At its core, it’s a corrosive system that inevitably leads to private deals that hurt the public interest.”

Hall noted that the figures in his report come from the campaign disclosure reports filed by the candidates. Most have not been audited for accuracy by the State Board of Elections staff. In fact, he said that 79 legislators filed their most recent reports through the mail rather than electronically, so the data must be keyed into a computer before it can be reviewed.

“The good news is that the General Assembly passed a new law this month that will require all candidates receiving more than $10,000 in an election cycle to electronically submit properly formatted reports,” he said. “The law doesn’t become effective until January 2017 because the Board of Elections needs time to prepare and test new software. It’s positive step, long overdue.”

[5] North Carolina’s new economic development group will release donors’ names, but may not say how much they gave : http://pulse.ncpolicywatch.org/2014/10/16/north-carolinas-new-economic-development-group-will-release-donors-names-but-may-not-say-how-much-they-gave/

[6] Charitable giving down in North Carolina : http://pulse.ncpolicywatch.org/2014/11/26/giving-down-in-north-carolina/